yep, RAR and filters stable but cash is growing again!
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yep, RAR and filters stable but cash is growing again!
Indeed, I am too. RAR falling, have had to extract more than half my (peak) funds now, since there has been little opportunity to deploy them on this platform in recent months. Checking it is becoming a waste of time.
Thank you Harmoney and Institutionals for usurping my share...
Having only recently joined Harmoney, I am at a different stage in the cycle than many of the established commenters here. I am so recent I don't even had a RAR yet!
Before investing, I read your whole thread, as I found it to be the most informative and impartial piece of information on HM anywhere on the web. It seems to me also that you guys thought the best days of HM were a few years ago. That's no good to me :rolleyes: but I'll still plough on regardless. Currently reinvesting any interest and principal paid back, checking daily, one $25 note at a time...
Anybody else having login issues this morning? My email & password (saved in LastPass) apparently don't match, and the forgot password page is down.
Edit: Seems it was a very temporary thing, or I hit the end of it. App & website now both working.
Harmoney is proposing a new scorecard (v1.6), got an email yesterday about it. Rates charged to borrowers are much reduced in grades C, D and E, a bit reduced in Bs and Fs, and unchanged in As.
The amount they can borrow will also change: Fs will be able to borrow up to $15k, Es up to $25k, Ds up to $35k, Cs up to $45k, Bs up to $55k and As unchanged at $70k.
grade old rate new rate variance old limit new limit
-----------------------------------------------------------------
A1 6.99% 6.99% NIL $70,000 $70,000
A2 7.99% 7.99% NIL $70,000 $70,000
A3 9.20% 9.20% NIL $70,000 $70,000
A4 10.50% 10.50% NIL $70,000 $70,000
A5 11.99% 11.99% NIL $70,000 $70,000
B1 13.39% 12.39% -1.00% $55,000 $50,000
B2 14.75% 12.59% -2.16% $55,000 $50,000
B3 15.80% 12.80% -3.00% $55,000 $50,000
B4 16.99% 13.99% -3.00% $55,000 $50,000
B5 17.80% 14.80% -3.00% $55,000 $50,000
C1 18.90% 15.90% -3.00% $45,000 $40,000
C2 20.40% 17.40% -3.00% $45,000 $40,000
C3 21.90% 17.59% -3.00% $45,000 $40,000
C4 22.99% 17.99% -5.00% $45,000 $40,000
C5 23.99% 18.49% -5.50% $45,000 $40,000
D1 24.70% 18.99% -5.71% $35,000 $30,000
D2 25.20% 19.49% -5.71% $35,000 $30,000
D3 25.49% 19.99% -5.51% $35,000 $30,000
D4 25.99% 20.99% -5.00% $35,000 $30,000
D5 26.49% 21.49% -5.00% $35,000 $30,000
E1 26.99% 21.99% -5.00% $25,000 $20,000
E2 27.49% 22.49% -5.00% $25,000 $20,000
E3 27.99% 23.99% -4.00% $25,000 $20,000
E4 28.29% 24.29% -4.00% $25,000 $20,000
E5 28.69% 24.69% -4.00% $25,000 $20,000
F1 28.99% 26.99% -2.00% $15,000 $10,000
F2 29.19% 27.99% -1.20% $15,000 $10,000
F3 29.49% 28.99% -0.50% $10,000 $15,000
F4 29.69% 29.69% NIL $10,000 $15,000
F5 29.99% 29.99% NIL $10,000 $15,000
New scorecard and details here. HM also says that a new C3 will not be an old C3, hence why the rates were adjusted.
I find the rate drop in Cs and Ds quite drastic - it will be hard to go and chase the 20%+. I guess it depends on an individual investor's strategy. Personally, I was quite content to stay B5 to D3, but to achieve reasonable returns of, say, 17-18%, I will either have to go "deeper" to the mid Es, or to forgo As and Bs and reduce diversification and solely focus on C1 to D5 or thereabouts.
Food for thought...
Harmoney is proposing a new scorecard (v1.6), got an email yesterday about it. Rates charged to borrowers are much reduced in grades C, D and E, a bit reduced in Bs and Fs, and unchanged in As.
The amount they can borrow will also change: Fs will be able to borrow up to $15k, Es up to $25k, Ds up to $35k, Cs up to $45k, Bs up to $55k and As unchanged at $70k.
grade old rate new rate variance old limit new limit
-----------------------------------------------------------------
A1 ... 6.99% .. 6.99% . NIL .... $70,000 . $70,000
A2 ... 7.99% .. 7.99% . NIL.... $70,000 . $70,000
A3 ... 9.20% .. 9.20% . NIL .... $70,000 . $70,000
A4 ...10.50% ..10.50% . NIL .... $70,000 . $70,000
A5 ...11.99% ..11.99% . NIL .... $70,000 . $70,000
B1 ...13.39% ..12.39% .-1.00% .. $55,000 . $50,000
B2 ...14.75% ..12.59% .-2.16% .. $55,000 . $50,000
B3 ...15.80% ..12.80% .-3.00% .. $55,000 . $50,000
B4 ...16.99% ..13.99% .-3.00% .. $55,000 . $50,000
B5 ...17.80% ..14.80% .-3.00% .. $55,000 . $50,000
C1 ...18.90% ..15.90% .-3.00% .. $45,000 . $40,000
C2 ...20.40% ..17.40% .-3.00% .. $45,000 . $40,000
C3 ...21.90% ..17.59% .-3.00% .. $45,000 . $40,000
C4 ...22.99% ..17.99% .-5.00% .. $45,000 . $40,000
C5 ...23.99% ..18.49% .-5.50% .. $45,000 . $40,000
D1 ...24.70% ..18.99% .-5.71% .. $35,000 . $30,000
D2 ...25.20% ..19.49% .-5.71% .. $35,000 . $30,000
D3 ...25.49% ..19.99% .-5.51% .. $35,000 . $30,000
D4 ...25.99% ..20.99% .-5.00% .. $35,000 . $30,000
D5 ...26.49% ..21.49% .-5.00% .. $35,000 . $30,000
E1 ...26.99% ..21.99% .-5.00% .. $25,000 . $20,000
E2 ...27.49% ..22.49% .-5.00% .. $25,000 . $20,000
E3 ...27.99% ..23.99% .-4.00% .. $25,000 . $20,000
E4 ...28.29% ..24.29% .-4.00% .. $25,000 . $20,000
E5 ...28.69% ..24.69% .-4.00% .. $25,000 . $20,000
F1 ...28.99% ..26.99% .-2.00% .. $15,000 . $10,000
F2 ...29.19% ..27.99% .-1.20% .. $15,000 . $10,000
F3 ...29.49% ..28.99% .-0.50% .. $15,000 . $10,000
F4 ...29.69% ..29.69% . NIL .... $15,000 . $10,000
F5 ...29.99% ..29.99% . NIL .... $15,000 . $10,000
New scorecard and details here. HM also says that a new C3 will not be an old C3, hence why the rates were adjusted.
I find the rate drop in Cs and Ds quite drastic - it will be hard to go and chase the 20%+. I guess it depends on an individual investor's strategy. Personally, I was quite content to stay B5 to D3, but to achieve reasonable returns of, say, 17-18%, I will either have to go "deeper" to the mid Es, or to forgo As and Bs and reduce diversification and solely focus on C1 to D5 or thereabouts.
Food for thought...
While I have not enquired for a while, I have not found any NZ P2P providers that accept children. Like you I wanted to invest on behalf. Does anyone have any ideas about WHY the P2P lenders wouldn't accept children? Is there a legal reason? Or is it just a hassle to set up and associate the responsible parent etc? Quite a few managed funds have accepted his money and tax bracket.
Ah, I think you are not comparing to 1.5! The rate reductions are much less... but shows how much times have changed since launch
Unfortunately, he IS comparing to 1.5 and it is that drastic!!
Worst still, the default rate is up for C4 to E5. For example under 1.5, E2 interest rate is 27.49% and annual chance of default is 3.73%. Under 1.6, E1 interest is now 22.49%, a drop of 5% while the annual default has gone up to 5.56%.
So we are being hit both ways! RAR will definitely drop. But with Reserve bank interest rate approaching zero, it is rather expected.
Regards
CB
I think that's what is driving the interest rates drop from a commercial point of view. I am guessing that most lending institutions (including banks) have had to drop their rates. And (for those of use with mortgages) while we are happy for our mortgage rates to drop down to 3.45% or thereabouts, this also means that borrowing rates across the board are also dropping.
Because as Cool Bear says, a drop in the interest rate for a particular grade doesn't mean that it has less chance of default as before, comparatively. A similar chance of default percentage now corresponds to a lower interest rate, so we lenders are being ask to risk more for the same return.
Interestingly, Harmoney also claims that they now have more than 5 years worth of data regarding risks and are now able to fine-tune their expected default rates, risk analysis etc. That may be true also?
Worked out the net impact on my current portfolio. My current weighted average interest rate on loans is 20%... superimposing new interestrates on revised dashboard it will be 17%
As per coolbear comments above, default rates unlikely to have changed in the last 2 years... that 3% reduction just a full hit to investor return.
I wonder how the insto's feel about the drastically reduced income with practically no change to the underlying risk?
Do you not feel that consumer finance in the unsecured space has a degree of inelasticity of demand?
Recall Myles mentioning Gem charging AER of 49%; and the unregulated loan shark shops continue to be a problem. OCR hasn't fallen off a cliff, its reduced by 0.75% in 3 years.
Intrigued what prompted harmoney to go this hard in their reduction. If they are supposedly making "no money" off loan applications; and investing their own money into the platform? Maybe the insto's are happy with 7% RAR instead of 10%, wonder how they'll like it when the market tanks.
I agree - I was aiming for a weighted average lending rate of around 20%, which put me at a C2 "centerpoint". I will now have to get down to a D5 (!) centerpoint, which obviously carries a lot more defaults risk. I too think the reduction in rates are drastic. Down 5% in some grades is not fine-tuning, it's a complete change of tack.
No problem - actually my new centerpoint is D3, not D5. Still a big step down from C2.
Toukshare,
You may find the following two charts of interest - these are my current loan distribution and all time defaults (ignoring grades with small loan numbers):
Attachment 10821
Attachment 10822
Using Harmoney platform average default rates can be well off if you apply any form of 'sane' selection process to your loans. It should be pretty obvious why I favour D's and E's when I can get them. Lower grades may not necessarily be lower risk. Hard to compare when everyone's selection process is different. ;)
The number in the second chart (y-axis) is the total number of defaults for that grade - these numbers are for my loans.
If you compare my C and D loans, D loans have had less defaults than C loans (by one) and I have more D's than C's - so D's are well ahead of C's for my loans. (i.e. D's are showing lower 'risk' than C's for my loans)
Selection of loans is different for everyone, so my results won't be indicative of someone else's, but they do show that using Harmoney generated average values can provide poor indications of actual risk/return.
Very interesting Myles.
It looks like for your loan book, defaults for C4 and C5 are worse than D1, D2, D3 and D4, and again D5 is worse than any Es.
As you say, it may indeed be because of your selection criteria, which I presume is a mix of grade-related criteria items (employment status, residence status, marital status, age, income, ratio) and non-grade-related (loan purpose, loan length, pp). If your selection criteria was purely related to items which influence the grade, then you'd expect your figures to be similar to HM, but obviously it's not.
Harmoney raises more Financing for Ozzy expansion....
https://www.interest.co.nz/news/1023...-and-2-unnamed
wow:
In the interest article:
Harmoney describes itself as a digital platform lender. Although it was licensed by the Financial Markets Authority as a P2P lender in 2014, Roberts says he now can't see a viable P2P lending model in New Zealand which is why Harmoney has started lending its own money.
So the founder of Harmoney cannot see a viable P2P lending future in NZ.
New scorecard (1.6) will be in force this Thursday (7th Nov)
Reached $5k in interest today, so thought it was timely to share some stats. I've really slowed down this year, due to the reduced quantity of loans hitting the retail marketplace, and tightening up on my investment criteria.
Total loans = 1,008
Average amount invested per loan = $39.63
Average age of loan in portfolio (current status) = 341 days
Average weighted interest rate (current status) = 20.73%
RAR (as at 26-10-2019) = 15.45%
XIRR (as at 6-11-2019) = 9.20%*
*adjusted by writing-off any loans that are 60+ days in arrears
Loan Book:
A = 32 loans
B = 232 loans
C = 333 loans
D = 308 loans
E = 89 loans
F = 14 loans
Attachment 10832
Attachment 10833
Attachment 10834
Nice going Alundra. I've hit the two year mark and approaching 15k on 80k active. Diversified across several P2P with around 200k in overall (a year ago had 70% in HM, now only 40%).
Its going to be a tougher environment returnwise with 1.6. The loans from H2 2018 are now 70% repaid, so 6 months max of RARs at the higher level, and then reducing quick as scorecard 1.6 loans replace the rewrites in the portfolio..
Static Loss Data H2 2017 H1 2018 H2 2018 H1 2019 H2 2019 OVERALL Count 203 525 1,141 781 870 3,520 Origin Amnt $ 6,809 $ 19,083 $ 45,546 $33,193 $ 41,642 146,272 Months 22 16 10 4 - 1 Interest Paid $ 1,285 $ 2,929 $ 6,183 $2,828 $ 994 14,219 Principal Repaid $ 5,719 $ 15,728 $ 30,251 $ 11,811 $ 2,701 66,209 Principal Remaining $ 905 $ 3,194 $ 14,800 $21,252 $ 38,941 79,093 Principal 31+ Days in Arrears $ 27 $ 79 $ 636 $ 730 $ 480 1,951 Default $ 185 $ 161 $ 495 $ 130 $ - 970 Expect Default - Full Term $ 445 $ 981 $ 1,641 $1,471 $ 1,835 6,373 HM Cohort Static Loss 3.80% 2.01% 0.96% 0.01% 0.00% 0.74% Portfolio Static Loss 2.71% 0.84% 1.09% 0.39% 0.00% 0.66% Expect Static Loss 6.53% 5.14% 3.60% 4.43% 4.41% 4.36%
Quick question re Harmoney's behaviour as regards to institutions vs retail investors.
This morning, I was monitoring the listings, refreshing often as I had some money to invest in loans. It was a good morning actually, and quickly some loans appeared. A D2, 2 D4s, a E5, a C1 and a F1. And then, but quite a while later, a B4. Now the B4 has a loan ID lower than the all the ones mentioned (LAI-00178855 for those who were monitoring too). Which to me means the application was completed earlier (am I right?).
So my question is: do we as retail investors see those "safer loans" after institutions have had first dibs, whereas those institutions (or HM) are happy for us to see the riskier loans first?
Because if that is not the case, then why are we seeing loans appear not in the order of their loan ID?
There will be a delay between a customer registering interest in a loan, completing the application (when the ID will be assigned), and then deciding on whether or not to accept the T&C's, interest rate etc., before it hits the marketplace.
Depending on the applicant, it may well be that the applications for the riskier loans were completed with a faster turnaround.
Anyone else having trouble Loggin into Harmoney @ 13:24??
Keep getting Logged out as though you had never Logged in!!
Mine was OK earlier and just now (in browser). Notice that they have a message up about going offline tomorrow night for maintenance. Maybe it's necessary maintenance for a bug that's stopping some people logging in sometimes? It did happen to me recently as well but resolved itself within the day.
It's fine this morning (via laptop Chrome too)
They say there will be maintenance at 10:30pm tonight (Wednesday), so not accessible then.
By the way, after 3 months in, I finally got a RAR (9.12%)
I personally calculate my XIRR at 9.45%
Attachment 10840
Attachment 10841
Account is very young (3 months) so no official charge off or write off yet although I see 2 of my loans haven't paid anything for 2 months - so I am sure they are candidate for a write-off. We'll see.
i stopped investing in grade A loans, they seem to all pay below my average RAR - so even if they pay perfectly they still drag the average return down, and that's without the odd one that defaults.
Thats because they are a lower interest rate .....
accidently took out a loan for $1100 :mad ;:
Attachment 10854
Three months invested in Harmoney, hoping to get to about $14,000 in by end of year. Displayed RAR hasn't quite reflected my actual RAR yet, waiting on a bit more interest to come in. Any tips from anyone on what you think the best Auto-Lend filter settings are? Cheers.
Supposedly Harmoney has changed the grading system... So a B5 loan of yesterday is no longer the B5 loan of today.
Does this resonate? I came across this dubious B5, and can't see too much evidence of a difference between the grading on 1.6 and 1.5. So am wondering if there was validity to this claim?
Attachment 10856
Attachment 10857
12 months and the wholesale (owners & institutions) RAR has increased by nearly 1% while the retail (us mugs) RAR has declined slightly. I suspect that the "better" loans are being cherry picked for the owners?
Wow, the repayment to income ratio is scary!!!
Apart from that, I guess as a borrower he seems not too bad - homeowner of 13 years with stable job and history of repayments. If he's a B5 I agree nothing much has changed, I would have expected him/her to be a lower B in the new grading system.
I just think he's just borrowing too much.
There's this too.
Attachment 10860
I just tend to take a small piece of everything. Just to get the benefit of the information... But within reason
So today 2 firsts for me:
- first time my RAR is above the platform's RAR
- first arrearsAttachment 10863
I'm only just over 3 months in though (108 days) so still very meaningless at this stage.
Hi,
I have a quick question regarding repayment schedule.
I have a loan taken on 19-AUG-2019 where the borrower does not seem to have made any repayments yet. Ever. To me this means that if it is, at worst, a monthly schedule, they should have made repayments on 19-SEP, 19-OCT and 19-NOV. But no. Nothing.
And yet the loan is not marked as 'in arrears', or any other non-current status. It is still 'current'. Whereas HM seems to modify the loan status to 'in arrears' in others.
I have attached the screenshot.
Attachment 10866
Are there any circumstances where that could be right? Maybe in case of 'unforeseen hardship', but then would HM inform us if they had granted this to a borrower?
Thanks
I rather think you are expecting Harmoney to behave like we would expect an organisation that cares about their customer to behave.....
I think your answer is in your questions words.......
Harmoney does not commuicate how we expect or would like.
I suspect you loan is in arrears and you finding out about it from Harmoney is in a 'holding pattern'.
Maybe best you call the Support Team on their 0800 #!
OK thanks - I wasn't aware of the 'holding pattern' scenario.
I'll definitely call HM regarding this.
Thanks again.
Dodgy data from Harmoney...
The record shows that the loan was advanced on 02/05/19, paid off on 14/05/19 yet the full principal of $100 is still outstanding.
There have been no repayments since the funds were released to the borrower 7 months ago yet the record indicates that Harmoney has received the full $100 (PAID-OFF DATE: May 14 2019).
I wonder where my money is?
Attachment 10871
Is anyone having issues with Auto lend?
I go after just about every c and d with a very loose filter and yet I have had nothing for a week now. 19 new loans in the last 24 hrs. Hard to believe none of them are c or d
Auto lend is green and plenty of funds.
So your Autolend didn't see that one? LAI-00181484, a D3
Attachment 10879
it was live at about 12noon approx.
Seems to be picking up a few, just not enough to dent the pile of cash sitting there!
12 autolends in the last week . However I have a large cash idle balance trying to get invested
Read Harmoney's information about Autolend in the FAQ.
Autolend operates on a queue. The determinant on that queue is the % of free cash in your portfolio. So if like me your % is 3% or less you will get nothing.
If you want to ensure autolend triggers you'll need to deposit funds into your account. I'm not sure what the best "cutoff" would be, but imagine somewhere around the 10% mark may ensure you get your autolend quota on most C/D loans.
Failing that, HM reset autolend following scoreboard 1.6. Have you reactivated it?
I guess it could be the time of year when Christmas bonuses are paid to employees. So maybe more loans are being repaid than are being taken up by by borrowers. Hence lender cash balances would be accumulating?
The FMA has just published data on NZ's Peer-to-peer lending and crowdfunding for 2019
https://www.scoop.co.nz/stories/BU19...-published.htm
Yes thankyou. That's exactly it. I was at 6% and was getting nothing. Boosted it up to 20% last night and I've immediately picked up several loans this morning. A pain having thousands sitting waiting at zero % but no other choice I guess.
% Rate Cuts @ HM today....
Attachment 10903
Happy new year everyone.
I took 1 note for morbid curiousity. A quality B3 loan to kick the decade off!
Attachment 10928
I think it will suffer from morbidity alright. Perhaps the only question is: How Long? I saw this Leesal; it just confirmed my view Harmoney is sending all the garbage our way.
See attached
Attachment 10933
Well, that assumes you tell WINZ you are living with parents.. and also excludes other possibilities, ACC payments based on someone on a good income struck down by disability being the obvious one.
But yes, I saw that loan.. grabbed my 10 foot barge pole and pushed it away.
At this risk of defending this I have a piece of that loan, mainly for information purposes. If HM is doing its job, then there should be zero difference in the performance between of "loans that look bad on paper", when compared to other loans of equivalent grade. So have started tracking these fugly loans, its early days but so far they have 0 defaults on $500 interest earned with about 6k active. The rest by way of comparison has a default rate of just under 10% of 16k interest, and have had some lovely looking loans turn sour. That said there are some loans that just wont touch .
(BTW - fugly portfolio has average income repayment ratio of 28%; rest has 8%)
Well I got my first loan write off. A grade, with house and never a payment made. Who would have thought it!!
Attachment 10934
Maybe I should just go for the F grades and get a better return if H can't get money out of someone with a house.
I guess that's unsecured lending at its worst...a lot of the info borrowers supply is accepted on trust. Who knows the true state of the property, its ownership and value v debt. It may not even exist! Harmoney has proven time and time again that very little due diligence in done when checking borrowers bona fides. Essentially they're keen to get $450 for each loan written/rewritten (which is paid (lent) up front by us - the lenders) and probably view the interest commission/fee as a bonus!
wow, 15 loans available at one time.. whats happened?
Hmm, some with only 9 days remaining.. odd, there was nothing there an hour ago.
Yes, saw that too. From nothing to 15 loans, all after pressing the 'refresh' button.
Anyway just wanted to say I've had my first charged-off too. A B4!!! I did enquire to HM a while back, as no activity was seen against this loan, and no payment ever for about 4 months. I got a reply from HM saying this was a case of 'family fraud'. Whatever that means? (what is family fraud as opposed to straight-up fraud?).
In any case, I would agree with the commenters here who said we are accepting HM's rating and information on trust, and suspect HM do not do a huge amount of due diligence (does the property exist? In what state is it in? What is its true ownership structure? What is the difference between 'living with parents' and 'renting'? How are bank statements PDFs checked? Do they check that the partner with large income is indeed a true partner? ....)
So far out of 130 loans that are over 3 months old, I have about 5 where no repayment has ever been made, there's a B4, a C5, a D5, a E4 and a F2. Quite the mix!
Toukshare, be prepared for a higher rate of defaults as you build your portfolio - typically you feel the effects from 9 months to 15 months (depending on the speed of investing). As you build your portfolio the number of loans invested in is high, as is the number of defaults after the initial 'grace' period. Once you have the bulk of your $'s invested and move into replacement of paid/re-written loans, the number of loans you invest in reduces, as does the overall defaults. Have a look at some of the previously posted RAR curves and you'll see the typical peak that drops down to a relatively steady RAR - something to be prepared for.
Thank you Myles. I am indeed prepared, having read the whole of this thread before investing 'proper'. So first of all, a big thank you for your own contributions on this thread, and to the others who have offered their wisdom and lessons learned from experience too. I particularly appreciated the stats. I know I will experience more defaults and charged off, and not necessarily only in the E and F grades. And as you say, my current RAR is somewhat meaningless, it only has proper value beyond 1 year of investing really.
Whelp, Harmoney's dead. In my email:
Quote:
Good morning,
After careful analysis of Harmoney’s business model and the company’s strategic direction we have made the decision to no longer offer new loans for investment by retail lenders from 1 April 2020.
CageyB, I just got the same email from Harmoney
So that's it - the end. As a newish investor (started August last year), thanks for nothing, HM. Anyone got any alternative apart from the Lending Crowd?Quote:
Subject: No new loans available to Harmoney retail lenders from 1 April 2020
From: The Harmoney Team
After careful analysis of Harmoney’s business model and the company’s strategic direction we have made the decision to no longer offer new loans for investment by retail lenders from 1 April 2020.
This does not affect existing loans, so current retail investments will continue to run out in accordance with their current terms following our closure of the platform to new retail lending.
This is not a decision we have taken lightly but we believe it is the right move to enable Harmoney to continue to lead the way in creating better personal loan products in a highly competitive market.
What this means for you as a Harmoney lender is laid out in detail below, however we would like to thank you for your support of Harmoney as a growing New Zealand business over the past five years.
What’s changing from 1 April 2020:
- Retail lenders will be unable to invest in new loans with Harmoney.
- If loans in your portfolio are rewritten or are paid off early, principal and interest repayments back into your account will not be able to be reinvested in further loans with Harmoney.
Auto-lend will be deactivated on 31 March 2020.
Well that's a lot of words telling us nothing - and there I was thinking their business model was P2P. Well, the signal-to-noise ratio was low on this one in any case, despite being first out of the blocks. Hope it doesn't start a trend though.Quote:
...we believe it is the right move to enable Harmoney to continue to lead the way in creating better personal loan products in a highly competitive market.
It could be a case of the retail IT platform being too expensive to manage, maintain and improve for very little benefit to them (assuming the percentage of money coming from retail investor was at most 20% and going downhill)
Although you'd imagine they'd be locked into the IT system for the next 5+ years.
AML would be costly to enforce. Imagine they'll save that. Plus less queries; and new accounts to set up.
But suprised about HM lack of spine. Sell a line to push their own status, and when the going gets tough, they find their "new friends" - the very ones they intended to disrupt in the first place
So you think maybe those "new friends" just gradually bought up the place. Invested a bit more each year, and a bit more, and then turned round and said "get rid of those pesky retail investors, and we'll go back to being the members-only club that we've always been"?Quote:
the very ones they intended to disrupt in the first place
Just phoned them up and asked about getting reclassified as a wholesale investor... need $10m for that lol
But had a good talk to them. Reason I got is low value retail investors are simply not economical to serve. Too much admin required answering queries, phone calls, IT etc
That really does make sense. If you can get on the platform with $50 loans or whatever the amount is that would be generating bugger all revenue for Harmony but the costs would still be as large if not larger than dealing with more experienced investors. Sad but it is the reality.
Cheers for the infor alistar.
Would it not be more reasonable if HM had looked for a solution to accommodate the investors. Arrange for a 3rd party to setup a managed fund; or a scheme through an institution?
Were the investors not part of the journey, over the past 7 years?
Hi Cool Bear. Been with Zagga for a year but never invested. How frequent do the loans come up?
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